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Environmental Protection
10. Paddy Tipping (Sherwood): If he will make a statement on the measures in his pre-Budget report which enhance and protect the environment. [18693]
The Financial Secretary to the Treasury (Mr. Paul Boateng): In keeping with the Government's commitment for taxation to reflect environmental impacts, the Chancellor announced in his pre-Budget report a series of environmentally based measures and consultations designed to protect and enhance our environment.
Paddy Tipping: The pre-Budget report contains important measures for moving towards a more sustainable energy policy, but will my right hon. Friend tell us when the long-awaited report on combined heat and power will be published so that the agreed targets can be met? Will he look closely at proposals put to him on coal mine methane development? If we could harness that we really would be in a win-win situation.
Mr. Boateng: We are considering carefully with the Department for Environment, Food and Rural Affairs what support might be offered on combined heat and power. DEFRA will be publishing a CHP strategy in the coming months. We are committed to CHP, which has an important role to play. We shall certainly also take into account the outcome of the performance and innovation unit's energy review.
On coal mine methane, we await a response from the industry to our request for information on the potential environmental benefits of that form of power. Also important is energy from coppicing, in which Members on both sides of the House have a particular interest, and we believe that the climate change levy exemption and the renewables obligation will provide a significant stimulus to that renewable form of energy.
Tim Loughton (East Worthing and Shoreham): If the Minister is so pleased with the Government's green record, can he explain why last week the Government's own greening government report, produced the day before the pre-Budget Report, revealed that all Departments had signally failed to reduce greenhouse emissions? The increase in energy was as great as 77 per cent. in
the Department of Health, while the Minister's own Department has increased energy consumption during the past year by as much as 23 per cent., as well as failing to reduce hardwood usage and failing on recycling targets. Is it not time that the Government put their own house in order, rather than preaching to others and piling millions of ill-targeted taxes on to businesses?
Mr. Boateng: The hon. Gentleman is plain wrong in his view of the impact of those taxes on businesses. He knows—as do Members on both sides of the House—that the climate change levy was devised and crafted with the closest co-operation of business. He also knows of the real benefits that have been gained by business as a result of the climate change levy, but he is absolutely right to point out that Departments should take a lead in this area. We are determined to do better. There is no room for complacency. This is a challenge we all face together.
World Development Goals
13. Helen Jones (Warrington, North): What recent discussions he has had with other Finance Ministers on progress towards a meeting the 2015 world development goals. [18696]
The Chancellor of the Exchequer (Mr. Gordon Brown): I used recent international meetings to push for greater efforts to achieve the 2015 goals. We have proposed a $50 billion international development fund under a new compact between developed and developing countries, and I hope that our proposal will engender an all-party consensus in the House.
Helen Jones: I am grateful to my right hon. Friend for that reply and for the personal interest that he has taken in the matter—it is a refreshing change from the previous Administration. My right hon. Friend will accept that achieving many of those targets will depend on an increase in aid, among other things. Can he tell me when he expects this country's aid budget to reach the target of 0.7 per cent. of gross domestic product? That is something that many of my constituents, even in the poorest areas, would like to see, as a sign of our commitment to the worst-off people in the world.
Mr. Brown: I thank my hon. Friend. I know that she takes a tremendous personal interest in both the debt relief campaign and the work on international development led by churches and others in her constituency. When we came into power the development aid budget was 0.27 per cent. Under this spending round, it is rising to 0.33 per cent. In the pre-Budget statement, I said that we envisaged a substantial increase in overseas development in the next spending round and a rise in the proportion of aid in our national income. That is why we made the proposal for an international development fund involving $50 billion. Its aim would be to halve poverty between now and 2015; to cut infant mortality by two thirds; and to ensure that every child in the world enjoyed primary schooling by 2015, instead of the present situation in which, this morning, 120 million children were not able to attend school.
We are asking other countries to join us in that. Negotiations will take place in the run-up to the finance for development conference. That goes hand in hand with our proposals on debt relief, where 24 countries now enjoy up to $50 billion of debt relief.
Dr. Vincent Cable (Twickenham): Does the Chancellor of the Exchequer support the views of the senior management of the International Monetary Fund, especially Ann Kruger, the vice-president, who argued last week that seriously indebted developing countries should enter the equivalent of bankruptcy proceedings to facilitate a rapid write-off of commercial and official debt? Do the British Government agree with her?
Mr. Brown: The hon. Gentleman is confusing two debates that are taking place. One is about whether, in our crisis prevention and crisis resolution measures, we as an international community look to a new system of international bankruptcy proceedings. The managing director of the IMF, Hans Kohler, has suggested that we need to consider that issue in far more detail because our crisis resolution measures are not good enough.
How we can help those countries that do not have a sustainable exit from debt relief is a separate issue. The answer is that other countries should follow what we have done, which is to provide 100 per cent. debt relief for debts that were incurred in the past, and that we do more through the international institutions to reduce debt. That is how we expect to proceed. Twenty-four countries now have debt relief. Perhaps another 10 could receive debt relief if they moved out of conflict. Under our proposals, it is possible for $100 billion in debt relief to be provided.
Mr. Andy Reed (Loughborough): I welcome the Chancellor's commitment to reducing debt. However, is he aware of my concern and those of other debt campaigners that the problem for those countries that are currently going through the heavily indebted poor countries initiative, and those that would wish to do so in the near future, is that even the World Bank has suggested that their future economic sustainability may mean that they will not be able to meet their current targets? Will he ensure that that issue is raised in future discussions with other Finance Ministers? Will he use his influence with the IMF and the World Bank to ensure that those programmes work for the poorest?
Mr. Brown: I am grateful to my hon. Friend, who is chairman of the all-party committee on such matters. The work that has been done by all hon. Members is much appreciated. We agreed at Ottawa that there would be greater flexibility in the award of debt relief to countries, especially taking into account the fall in commodity prices that has affected Africa in particular. We therefore agreed that, at the point of completion, there will be more flexibility to enable countries to get a sustainable exit from the debts that they have incurred.
The fact of the matter is that four years ago only one country was likely to receive debt relief; now, as a result of a decision made on another African country last week, 24 have got debt relief. The next stage is for post-conflict countries to get the debt relief that they are due, which would mean that we would achieve our target of $100 billion in debt relief. I agree with my hon. Friend, however, that more will have to be done if we are to have
a virtuous circle of debt reduction, poverty reduction and sustainable development, and that is why the focus must now also be on the 2015 development targets.Euro
14. Mr. Ian Taylor (Esher and Walton): What are the latest estimates of Treasury expenditure on business euro preparations for the 2001–02 financial year. [18697]
The Chancellor of the Exchequer (Mr. Gordon Brown): Some £10 billion—[Interruption]—£10 million, and the Opposition will be happy to note this, has already been spent on business euro preparations. Some £23 million has been spent to adopt euro-compatible systems in the Inland Revenue and the Department for Work and Pensions. A copy of the Treasury's fifth report on euro preparations, which was published on 4 November, has been deposited in the Library.
Mr. Taylor: The Chancellor may overspend if he put £10 billion into the problem, but £10 million is too little. Does he agree that there will be a real competitive challenge to industry and traders in this country on 1 January—that 80 per cent. of the single European market, which is the home market for British business, will have one currency? There are 13 million visitors from the eurozone to this country. It is urgent that British companies not only accept notes and coins in euro denominations, but look at their marketing strategy and prepare themselves for what will be the dominant currency in our home market.
Mr. Brown: That is precisely why, in the most practical way, we have done what we can to help British businesses to prepare. We have published 425,000 fact sheets on euro preparation for businesses; we have written to 1.5 million small firms to inform them about the needs that will arise from the euro; we have published more than 50 business case studies showing how the euro can be adapted; and we have issued a euro preparations leaflet to 1.6 million small businesses. In addition, a leaflet is being distributed at ports and airports explaining to travellers to and from the United Kingdom how the euro will work.
We are working with all the sectoral bodies in our euro preparations committee—which includes the Bank of England, the chambers of commerce, the Confederation of British Industry and many other organisations—to produce material for clients in different sectors. In addition, there is a telephone helpline available for businesses inquiring about Europe.
I may add that we are encouraging people who have old coins and notes in foreign currencies that will be converted into the euro to give them to charity, if they are prepared to do so, and we are giving tax relief for that.
Dr. Stephen Ladyman (South Thanet): Retailers, banks, manufacturers and exporters are already having to spend huge amounts of money to get ready for the introduction of euro coins and notes. However, the real advantage to those businesses will occur only if we are in the eurozone and have the advantage of lower interest rates and still lower costs to business. Should not real
preparations be made now to build up the campaign to explain to the British people and to British business the full advantages of joining the euro?
Mr. Brown: It is precisely to inquire about all the advantages of the euro that the five tests will be applied. The technical and preliminary work that is being undertaken in the Treasury will lead to an assessment within the first two years. The issues that must be examined and on which an objective assessment must be made include the effects on employment; the effects on investment; the effects on the flexibility of our economy; the effects on different sectors, including financial services; and whether there is sustainable and durable convergence. I believe that most businesses think that these are the right tests to make.
It would be wrong to do what the Opposition do and rule out the euro on principle as a matter of economic dogma even if it were found to be in the national economic interest to join. The shadow Chancellor, the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), shakes his head, but in 1997 he said that he was against the single currency "in principle". Does he still hold that view?
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